In a day where Americans have only begun to recover from the recent recession, bankruptcy declarations have grown exponentially. According to estimates from US bankruptcy courts, well over a million people declare bankruptcy every single year.

Here are the top ten reasons why Americans file for bankruptcy:

Reduced Income

When a person’s employer decides to cut down on expenses, this can turn into a lighter paycheck to take home. If things go haywire, a reduced income can cause a person to declare bankruptcy.

Health Expenses

A study out of Harvard University said that over 60 percent of people who declared bankruptcy did so because of medical expenses. The same study also showed that the majority of people who filed bankruptcy on their medical bills had health insurance. The study served to debunk a dominant myth that people with significant health expenses don’t have health insurance. Unfortunately, health insurance often does not cover expensive procedures, and most people cannot afford to pay their family deductible, which is often well over $6,000.00 to $12,000.00 annually.

Credit Cards and Credit Lines

Most people don’t get incur credit debt because of irresponsible behavior. They can get into this sort of trouble due to job loss, reduced income, medical emergency, or last-minute expenses.

Job Loss

Even if you get a big severance check, those funds can quickly run out. With no guarantee that you will immediately get a new job, things can get frantic quickly. Some people who have lost a job have had to declare bankruptcy to stay on their feet.

Last-Minute Expenses

An emergency can happen at any time. Whether you need to deal with a broken pipe, a busted car engine, or a sudden medical expense, these can cause a significant drain on your savings. If you have several unexpected emergencies, this can result in a financial picture that may need to end in a bankruptcy declaration.

Getting Divorced

These days, asking for an inexpensive divorce is like asking to see a pig fly. Getting separated and then divorced can result in a substantial loss of income and property for one or both parties. If you co-signed or opened an account with your soon-to-be former partner, you might need to take on extra debt. With a divorce, an income is lost, which can make it difficult to manage daily household bills with one paycheck.

Utility Bills

Paying for air conditioning, electricity, and heating can take a significant chunk out of many people’s budgets. If the chunk becomes large enough, you might need to declare bankruptcy to get out from under the financial rubble.

Student Loans

So many Americans have gotten into trouble with their student loans that talk of a student loan “bubble” has yet to subside. According to statistics, at least 15,000 people declare bankruptcy each year because of student debt. Unfortunately, student loan debt is not dischargeable in bankruptcy, however, there are other options, such as a hardship discharge that can be explored with an experienced attorney, such as those at Zellar & Zellar, Attorneys at Law, Inc.

Overspending

Managing money is a difficult task for many people. If you don’t reign in your spending, faulty financial habits can lead you down the road to bankruptcy.

Home Foreclosure

Often times, with a job loss or reduced income, the household bills can become unmanageable. For some, making the house payment, while juggling credit card and medical bills can be daunting. If a foreclosure is looming, filing for bankruptcy can help if surrendering the home is the best option, or if retention of the home is what is desired.

Filing for bankruptcy can be a difficult decision to make. The best course of action is to ask for help and guidance from an attorney you can trust. The attorneys at Zellar & Zellar, Attorneys at Law, Inc., are here to help provide you the information you need to be able to make a wise decision regarding bankruptcy and whether it is right for you and your family. Call us today to schedule your free consultation.

We are a federally designated Debt Relief Agency under the United States Bankruptcy Laws. We assist people with finding solutions to their debt problems, including, where appropriate, assisting them with the filing of petitions for relief under the United States Bankruptcy Code.
No Attorney-Client Relationship Created by Use of this Website: Neither your receipt of information from this website, nor your use of this website to contact Zellar & Zellar, Attorneys at Law, Inc. or one of its attorneys creates an attorney-client relationship between you and Zellar & Zellar, Attorneys at Law, Inc..Find us on Google+Google